Eagle Brand Holdings Limited

[ichew]

http://info.sgx.com/webcoranncatth.nsf/ ... penelement

giving $0.08 capital reduction
today would be a good day to sell IF i had believed n bought at $0.055
ah well ...

[padawan]

today would be a good day to sell IF i had believed n bought at $0.055

Eagle will still remain listed as a cash shell after the return of capital. IIRC, this cash shell has > 0.003 cash, and 90% is under escrow, and needs to be returned to shareholders should it fail to consummate a RTO within 12 mths.

In a recent interview, the CEO estimated the cash shell to be worth 0.005. If you're vested at 0.055, that's a 9% spread to pay for the lack of faith of the sale going through next week. Costly, IMHO.

[bluechipstamp]

As a risk arbitrage play, Eagle offers one of the best risk/reward I've seen in a while.

The Reward:
8c cash distribution + cash shell with 0.003 (but will be traded at a minimum price of 0.005).

Even if you've gotten in at last week's 0.075, the 8c cash distribution represents a 6.66% spread. If u factor in the cash shell @ 0.005, it offers a whopping 13.3% spread. The few recent risk arbitrage plays I've seen offers only about 4-5% spread.


The Risk (before today's EGM):
By last week, the risk pretty much boils down to shareholder approval. Since the biggest shareholder is abstaining from vote, and the 2nd + 3rd shareholder holds about 50% of the remaining shares, they hold the key.

If u google hard enough, you'll discover that:
1. The 2nd shareholder is buddy buddy with the chairman.
2. Eagle had planned for this since 2 years ago, and the 2nd shareholder's purchase of Rowsley stake is part of this plan.
3. Eagle CEO's job was to restructure the loss-making coy. He considered his job done with this acquisition announcement, and quitted ahead of today's vote.
4. Eagle's CEO mentioned that the buyer (biggest shareholder) is willing to buy, and more importantly, the sellers are willing to sell. It doesn't take a genius to figure out which sellers he's referring to.
5. There's actually another competing bid to buy Eagle at the same price, although it's not widely reported in the press.


I was > 90% sure today's resolutions will be passed. When I entered this morning's EGM and saw Hong Leong (3rd shareholder) sitting on stage with the rest of the directors, I smiled to myself - the result is out. For those who have done their homework, this is a case of very low risk but meaningful return, IMHO.

[millionairemind]

BCS - Congrats

[Aspellian]

sorry, been busy so cant reply nor monitor earlier


hi san san
it was a chance random encounter
i came across this while scanning thru sgx announcements which i do when i am free
btw as i am a christian,i also believe my God will show me
BUT this is really a personal belief

Hi ichew,

while browsing throught the forum, i noticed this posting - Praise the Lord!

I am blessed to be able to find Christ together with my wife in May last year.

Thought of dropping you a PM - maybe we can meet up for coffee in the near future.

God Bless You!

Aspellian - ryan

[winston]

Not vested

Eagle Brand, which manufactures ceramic tiles, said on Thursday that Malaysian-based offshore marine group Nam Cheong will list on the Singapore Exchange through a reverse takeover of the company for S$472 million.

It had requested for a trading suspension on Friday


Source: Reuters